Contract Attorneys often have to deal with a claim of tortious interference with a contract.
This post discusses issues that contract lawyers must deal with in tortious interference claims,
- The basic elements of tortious interference with a contract
- The need for a contract to have been breached
- The alternative to breach, namely that performance with a contract could have been made more burdensome
- Allegations against corporate agents
To prove that someone has engaged in tortious interference with a contract, the party seeking affirmative relief must show: 1) an existing contract subject to interference; 2) a willful and intentional act of interference with the contract; 3) that proximately caused the plaintiff’s injury; and 4) caused actual damages or loss. Prudential Ins. Co. of Am. v. Fin. Review Servs., Inc., 29 S.W.3d 74, 77 (Tex. 2000).
To prevail on this claim, a plaintiff must present evidence that the defendant interfered with a specific contract, and that the other party “was more than a willing participant and knowingly induced one of the contracting parties to breach its obligations under a contract.” Funes v. Villatoro, 352 S.W.3d 200, 213 (Tex. App.–Houston [14th Dist.] 2011, pet. denied). A Contract Lawyer at 713-979-2941 will be able to identify whether a contract was breached or not.
However, even if a contract was not breached, a party seeking affirmative relief may show that the other party prevented the performance or made the performance impossible or more burdensome, difficult or expensive. Hughes v. Houston Nw. Med. Ctr., Inc., 680 S.W.2d 838, 842 (Tex. App.-Houston [1st Dist.] 1984, writ ref’d.). Even so, the party claiming an increased burden must show that he was entitled to performance under the contract with which he is alleging interference. “Texas law recognizes that interference which makes performance more burdensome or difficult, or of less or no value to the one entitled to performance, may constitute an actionable tort,” said the Court. Id. (emphasis added). A Texas Contract Attorney can help you understand if you may have a claim for tortious interference with your contract. Call 713-979-2941 to consult with Hector Chavana Jr.
In Funes, for example, the parties seeking affirmative relief were unable to meet their burden of showing a specific contract had been breached. He “did not point to any specific contract he had with any advertisers; nor could he point to any specific advertisers who had stopped advertising on his show or in his magazine because of anything the Funeses said or did.”
Sometimes, interference with a contract can be justified by a defendant’s rights or a good faith claim to colorable rights. Prudential Ins. Co. of Am. v. Fin. Review Servs., Inc., 29 S.W.3d 74, 77 (Tex. 2000). “Generally, justification is established as a matter of law when the acts the plaintiff complains of as tortious interference are merely the defendant’s exercise of its own contractual rights…if the plaintiff pleads and proves methods of interference that are tortious in themselves [like defamation, threats, or vilence] then the issue of privilege or justification never arises.” Call Hector Chavana Jr at 713-979-2941 to consult with a contract attorney about your contract, tortious interference or business law issues. Said differently…
Efforts to induce someone to exercise their rights to dissolve a contract do not constitute tortious interference of contract because the efforts are justified. See ACS Investors, Inc., 943 S.W.2d at 430. Efforts are justified if (1) the relationship concerns a matter involved in the competition between the actor and the other (2) the actor does not employ wrongful means (3) his action does not create or continue unlawful restraint of trade and (4) his purpose is at least in part to advance his interest in competing with the other. See Caller-Times, 855 S.W.2d at 21 (citing Restatement (Second) of Torts § 768(1)). Efforts are wrongful if they involve physical violence, fraud, civil suits and criminal prosecutions, but not limited economic pressure. Id. However, the mere fact that an employment contract is at-will is not an absolute defense to the tort of interference with contract. Sterner, 767 S.W.2d at 689.
Kadco Contract v. Dow Chem. Co., 198 F.3d 241 (5th Cir. 1999).
One last interesting point. Often, a person alleging tortious interference with a contract will allege that a corporate officer is personally liable for tortious interference with a contract. It is generally true that a corporate officer is personally liable for his own torts, even if he is acting for a corporation. However, Texas courts have made it relatively difficult to apply liability for tortious interference against a corporate officer working for the best interest of a corporation:
“The elements of tortious interference with a contract are: (1) the existence of a contract subject to interference; (2) willful and intentional interference; (3) interference that proximately caused damage; and (4) actual damage or loss.” Powell Indus., Inc. v. Allen, 985 S.W.2d 455, 456 (Tex.1998). “When the defendant is both a corporate agent and the third party who allegedly induces the corporation’s breach, the second element is particularly important.” Id. at 456-57. “Because a corporate officer’s acts on the corporation’s behalf usually are deemed corporate acts, a plaintiff must show that the agent acted solely in his own interests.” Id. (Emphasis added.) “The plaintiff must prove that the agent acted willfully and intentionally to serve the agent’s personal interests at the corporation’s expense.” Id. (Emphasis added.) “A corporate officer’s mixed motives-to benefit both himself and the corporation-are insufficient to establish liability.” Id.
“[W]hen determining whether an agent acted against the corporation’s interests, we consider the corporation’s evaluation of the agent’s actions.” Id. We do so because “[a] corporation is a better judge of its own best interests than a jury or court.” Id. Although a complaint by the principal about its agent’s actions does not conclusively show that the agent acted against its principal’s interest, “if a corporation does not complain about its agent’s actions, then the agent cannot be held to have acted contrary to the corporation’s interests.”
Hong Kong Dev., Inc. v. Nguyen, 229 S.W.3d 415 (Tex. App.-Houston [1st Dist.] 2007, reh’ing o’ruled, no pet).